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Lisa Napoli: Just days after President Bush said the economy wasn’t in a recession, just growing slowly, the National Conference of State Legislatures has issued a report that says, regardless of what’s happening on the national level, some states appear to be in a recession. Sixteen states are reporting budget shortfalls for this fiscal year totaling at least $11 billion. Marketplace’s Nancy Marshall Genzer has more.
Nancy Marshall Genzer: States are being battered on a number of fronts. Take housing construction; purchases of building supplies, furniture and appliances are down. That means less revenue from sales taxes. Luckily, when times were good, most states created rainy day funds.
Bill Pound: It may be raining or starting to rain again.
Bill Pound is the executive director of the National Conference of State Legislatures. Pound says if the rainy day turns into a monsoon, states have two choices:
Bill Pound: To cut expenditures even further, and the other is to raise revenues.
And we’re not just talking taxes. Illinois might sell its lottery. Other states may put toll roads or unclaimed property on the auction block. Joe Hackney is the speaker of the North Carolina House.
Joe Hackney: We have not mortgaged our lottery or our roads, but revenues are slowing and we’re nervous.
There’s good reason to be nervous. Next year, 23 states are expected to face budget deficits totaling more than $26 billion.
In Washington, I’m Nancy Marshall Genzer for Marketplace
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